The House of Representatives late Tuesday passed an emergency supplemental appropriations bill that includes a provision to reform and restart the Rural Housing Service single-family guarantee program.
President Obama is expected to sign the measure (H.R. 4899), which includes funding for the wars in Iraq and Afghanistan as well as other international and domestic government programs.
The RHS provision authorizes the Agriculture Secretary to increase the upfront premium on RHS backed loans to as much as 3.5% to cover the cost of new loan guarantees and make the program self-funding. The current upfront premium is 2%.
The USDA secretary also has the option of charging a 0.5% annual premium. RHA secretary Tammye Trevino could not reached for comment at press time.
Rep. Paul Kanjorski, D-Pa., was the original sponsor of a bill to increase the premium and free the RHS program from the congressional appropriations process.
In fiscal year 2010, congressional appropriators provided RHS with $12 billion in loan commitment authority and a 'carry over' of $1.1 billion in unused authority from the prior year. But RHS exhausted the commitment authority in May, forcing many lenders to stop making government-backed rural housing loans. The new fees should provide RHS with the necessary credit subsidy to guarantee $24 billion worth of loans annually
USDA Home Loans funding update
As you all have heard for months now that USDA was out of money. This is not been the case for USDA Home Loans and Neighborhood Funding. We have been funding these purchases up to May 17. We were offering conditional loan commitments and funding all USDA transactions until we received a email from USDA recending a previous email that gave us the ability to issue conditional loan commitments and fund all of our USDA transactions. This has not stopped but placed a temporary lapse in funding.
Posted to: MND NewsWireFriday, April 23, 2010 1:25 PM
The continued availability of government guaranteed mortgages for rural homebuyers was virtually assured yesterday when the House Financial Services Committee voted to approve H.R. 5017. The unanimous vote will send the Rural Housing Preservation and Stabilization Act of 2010 to the full House of Representatives where sources said it was fast tracked for a vote as early as next week.
If passed, the bill will correct the Section 502 Single Family Housing Guaranteed Loan Program to make it self-funding. Section 502 assists homebuyers living in rural areas to obtain affordable mortgages guaranteed by the Department of Agriculture (USDA). These loan guarantees have become enormously popular during the financial crisis and consumer demand has tripled the annual number of loans that are typically issued each year. The program is set to exhaust its available funds within days. Under the new legislation, lenders will pay up to a 4 percent premium for the guarantee at the time the loan is initiated which will enable the financing of the program to move from a combination of government funding and industry fees to a self-sustaining initiative. The bill authorizes the department to guarantee up to $30 billion in loans in FY 2010.
In order to qualify for the program an applicant must have good credit and reliable and adequate income sufficient to sustain mortgage payments. The average guarantee in 2009 was for a $112,000 mortgage.
In an announcement of the bill's passage the Committee said that the program provides a vital source of mortgage credit for people living in rural communities where low and moderate-income residents often have fewer credit options than households in urban areas. The USDA program aims to fill that void and lower the costs of homeownership by giving rural areas access to a home loan guarantee program.
The bill was sponsored by Congressman Paul E. Kanjorski (D-PA), Chairman of the House Financial Services Subcommittee on Capital Markets, Insurance, and Government Sponsored Enterprises. He said of the bill, "Since its creation in 1987, USDA's affordable rural home loan guarantee program has helped hundreds of thousands of families to realize the American dream of homeownership, including many in Northeastern Pennsylvania. As a result of the unprecedented demand, the program is now unfortunately running out of money. At no cost to taxpayers, my bill will preserve the access of millions of families living in America's heartland to needed USDA loan guarantees, so that they can continue to buy homes with affordable mortgages. Without action, too many families in rural America will have no options for getting home loans. We cannot allow that to happen."
Note: We are still funding the USDA Rural Development loans. Call us for info.
1-800-993-1947
We still have plenty of USDA Rural Development mortgage money...
Most banks and mortgage lenders have stopped taking USDA mortgage applications due to limited funds. The funds were supposed to be depleted by the end of April. Because almost all banks and lenders have stopped funding these mortgages the remaining funds are going to last longer than expected. We anticipate the remaining funds will last thru June. We are still taking applications and funding USDA Loans.
Apply Now to reserve your share of the remaining funds.
There is still time to get the $8000 tax credit.
You have until the end of April to be under contract to purchase a home. You do not have to close until the end of June.
We have just been notified that since so many banks have stopped funding USDA Loans that the funds will last longer than anticipated. Probably thru May.
We are still taking applications and closing USDA Loans at least thru May.
There is also talk that the current funding fee of 2% will be increased to 3.25% and with this increase there would no longer be a shortage of funds for this program.
Apply Now before the funds run out
The answer is yes and soon. If you want to use the USDA Home Loan program you better act Quickly. See the letter below.
SFH Origination News
From the National Office in Washington DC
Single Family Housing Guaranteed Loan Program
March 10, 2010
Notice of Funding
This message is to notify you that program funding for the Single Family Housing Guaranteed Loan Program will likely be exhausted by the end of April, 2010.
Once funding is exhausted, the Agency will not issue Conditional Commitments “subject to receipt of appropriated funds.” This is because it is not certain when additional funding will be available.
Limited funding may become available for disaster areas declared in 2008, or in disaster areas declared for Hurricanes Katrina and Rita. Limited funding may also become available as prior Agency commitments are de-obligated, however, such funding will be very limited.
We apologize for any inconvenience this may cause you. Should you have any questions, you may contact the Single Family Housing Guaranteed Loan Division at (202)720-1452.
To unsubscribe from this list, please do the following:
Go to http://www.rdlist.sc.egov.usda.gov and enter your email address and click on the “SFH Servicing News” checkbox and then click on the “Unsubscribe” button.
To Subscribe to this list or other available lists or unsubscribe an old email address and subscribe a new email address, go to http://www.rdlist.sc.egov.usda.gov and enter your email address and click on the appropriate e-mail list(s) to which you wish to subscribe and then click on the “Subscribe” button.
The U.S. Department of Agriculture (USDA) prohibits discrimination in all its programs and activities on the basis of race, color, national origin, age, disability, and where applicable, sex, marital status, familial status, parental status, religion, sexual orientation, genetic information, political beliefs, reprisal, or because all or part of an individual’s income is derived from any public assistance program. (Not all prohibited bases apply to all programs.) Persons with disabilities who require alternative means for communication of program information (braille, large print, audiotape, etc.) should contact USDA’s TARGET Center at (202) 720-2600 (voice and TDD). To file a complaint of discrimination, write: USDA, Director, Office of Civil Rights, 1400 Independence Avenue, S.W., Washington, D.C. 20250-9410, or call (800) 795-3272 (voice) or (202) 720-6382 (TDD). USDA is an equal opportunity provider, employer, and lender.
USDA Rural Development home loan versus an FHA Home Loan...
Click the eligibility maps above to see if you area qualifies for a USDA Home Loan.
If you are currently renting now may be the time to consider buying.
In many areas of the country it is now it is cheaper to purchase a home than to rent one.
When comparing always figure what your property taxes and homeowners insurance will be in addition to your principle and interest payment.
For example, if you are considering a $150,000 home with no down payment your monthly principle and interest payment would be approximately $829 per month.
Estimated property taxes $2000 per year.
Estimated homeowners insurance $800 per year.
Divide each of these by 12 and add them to your principle and interest payment to figure your total monthly payment.
principle and interest payment $829
Monthly property taxes $167
Monthly homeowner insurance $67
Total monthly payment (piti) $1063
With the $8000 tax credit now is a great time to stop renting and purchase a home of your own.
Apply Now... It's Fast And Free
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